Every time the Dodgers sign a Free Agent or extend Tommy Edman, the non-Dodger fans continue to cry the Dodgers are ruining baseball. AND THEN when they deferred a lot of the salaries, the cries got louder. Because only the Dodgers sign free agents and defer salaries.
Yes the Dodgers are flaunting their wealth, but why shouldn’t they? They are not done. I do not know what it is going to take to sign Clayton Kershaw, but the Dodgers are not going to let $$$ stop them from re-signing Kersh. The Dodgers are going to tryouts for free agents, including Max Scherzer. The LAD scouts came away very impressed with Scherzer. Probably nothing, but with the Dodgers this year, who knows.
The Dodgers also scouted LHRP Tyler Matzek, who is throwing a new pitch with Trackman, a slider. The Dodgers pitching gurus are pretty expert at perfecting sliders. They can always use another LHRP, right?
What is with all of these Alex Bregman rumors? Of course that could generate a lot of angry comments from Dodger fans and non-Dodger fans alike.
The go-to solution to these fans is a salary cap. Apparently more owners are beginning to like the idea of a salary cap. I do not think we need to take a litmus test with MLBPA to see if they have softened their stance.
The idea of a salary cap is to bring parity to MLB. After all NFL and NBA both have salary caps.
- KC Chiefs are in their 3rd consecutive Super Bowl and 5 out of the last 6.
- KC and Philadelphia Eagles are meeting for their second Super Bowl in the last three years.
- Before KC domination, New England was in 9 Super Bowls (6 wins) since 2001.
- 20 of 32 NFL teams reached the Super Bowl since 2001 (62.5%).
- The NBA has a salary cap, and the Celtics are cruising to their 11th straight playoff appearance.
- 17 of 30 NBA teams reached the NBA Finals in the last 25 years (56.7%)
- The Lakers have reached the Finals in 8 of those years, Miami 7, and Golden State has reached the Finals 5 times.
- 21 out of 30 MLB teams have reached the WS (70%).
- No MLB team has won back to back WS since 1998-2000 (NYY). The same is not true with NFL or NBA.
- Winners – MLB Winners since 2000 (16); NFL winners since 2000 (13); and NBA winners since 2000 (11).
I am not sure that a salary cap has brought more parity to the NFL and NBA more so than MLB.
One of the premier analytical publications, Baseball Prospectus, conducted a recent study on the subject and came to the following conclusion:
The underlying premise is incorrect. Inequality among MLB teams isn’t high; it’s about normal over MLB history. And while the ability of teams to advance in the standings in the National League (and the corresponding deposing of perennial winners) is lower than average, it’s not at historical lows. And the opposite is true in the American League, where mobility in the standings is higher than average. A salary cap seeks to address a problem that doesn’t exist.
Another area of concern for many LAD haters is the signing bonus. Too many of these brain challenged haters refuse to believe that signing bonuses are in fact included in the AAV for CBT purposes. There are reasons why signing bonuses are included. Take Blake Snell. Snell resides in Lynnwood, Washington during the offseason. Washington State does not have a state income tax.
That is not the reason for all signing bonuses, but it is for many.
The Dodgers are also referred to as the LA Deferrals because of the number of deferred deals they have inked, especially the last two years. While the Dodgers are being castigated for their deferred contracts, the same acrimony is not leveled on Arizona for their deferred amount for Corbin Burnes. His deferred amount is a little convoluted, but the total deferral could be $64MM.
Toronto’s heavily deferred contract with Anthony Santander includes $61.75MM deferred money on a $92.5MM contract. The NPV of that contract is $68.6MM.
No matter how many times the mentally challenged have to be told, the NPV of the deferred amount has to be deposited into an escrow account on or before the second July 1 following the championship season in which the deferred compensation is earned. This is not open to question. It is a requirement per the CBA.
All teams can choose to defer a portion of the contract and take advantage of the “loophole”. They just choose not to. Maybe the owners are not competent to handle the investment.
But the one that sticks in the craw of the fans (and possibly other owners) is Shohei Ohtani. Every other team could have made the same deal, but most (if not all of those teams) did not have the ability to properly take advantage of the marketing opportunities that Ohtani availed to the Dodgers.
The Dodgers made $70MM on new sponsorships from Japanese partnership/sponsors alone. Not to mention the increase in ticket revenue, merchandise sold, food sales, parking…And for 2025, ITO EN, a green tea, has signed a local Club partnership agreement with the Los Angeles Dodgers. Not only just LAD, but Ito En is now the Official Green Tea of MLB, and in the U.S., Ito En is an Official Partner of MLB. ITO EN will run various promotions in Japan and the US as part of the “Oi Ocha” x Ohtani x MLB 3-way relationship.
Do you think the other owners are not going to benefit from this new partnership?
Have the other owners taken advantage of Ohtani? Per:
Ohtani’s star power is having a major knock-on impact. With an estimated $15 million in earnings from billboard deals during Ohtani’s road games, teams hosting the Dodgers have seen a huge surge of Japanese sponsors wanting to get their name out there. Like a devoted entourage, it seems as though brands are actually following him around the nation. Japanese businesses swarm to sponsor and promote during Dodgers games, whether they are against the Yankees, Orioles, or any other team. Ohtani’s effect is evident.
Baseball has brought in around $300 million in new sponsorships in 2024 with new assets like jersey patches and helmet logos. It increased the league’s overall sponsorship revenue to $1.84 billion, a 16% rise from the previous year and a 36% gain over the previous three seasons. No league is expanding as quickly as MLB, even though the NFL currently leads the pack with an estimated $2.3 billion in sponsorship revenue. Ohtani’s impact has been a major contributor to this expansion, demonstrating that baseball is more than simply a game but also a rising worldwide corporate force.
Those owners are not going to say no to their increased revenue. Baseball is flourishing because of the Dodgers and their deferred deal with Ohtani. Of course the Dodgers are taking more advantage and adding more elite players. But they are not ruining baseball.
The worst of the fans are the Padre fans. They claim the Dodgers are ruining baseball because their ownership group is sitting idly by and doing nothing thus far. The ownership group of the Padres is a mess.
San Francisco Giants – I can understand why hitters may not want to sign a free agent contract with SFG. But pitchers? Why couldn’t Posey put a financial package together as good as (or better than) Arizona? Sometimes you have to pay a premium to get that free agent. Burnes’ contract was not outrageous, and SF can afford the $$$ better than Arizona. Maybe Arizona wants to win more than SF?
One of the newest owners, Baltimore’s David Rubenstein, is worth $4.1BB, and one of his co-owners, Michael Aroughetti is worth $2.5BB. They certainly have the wherewithal to sign free agents like Corbin Burnes. They chose not to. That is not the Dodgers fault. Baltimore’s window will close quickly unless they can win a pennant and prove they can win. So when Rubenstein complains about the LAD free spending, those complaints fall on my deaf ears. The Dodgers have proved they can win, and now free agents want to play for them, even with deferrals.
One other point I like to make when fans like to say the Dodgers are ruining baseball…I did not hear those comments when Fox and Frank McCourt owned LAD. Nobody cared what the Dodgers did.
Excellent analysis Jeff! Sour grapes from all of those teams. And some of the media have started saying the same thing. Ohtani is a cash cow, and it is only going to get better for the Dodgers. Jake Lamb signed a minor league deal with the Giants. He was in the Pirates organization last year.
Getting better, visits from the family always help, My sis, Donna, daughter Carrie, me and my granddaughter, Laycee.
Excellent article Jeff. You covered a lot of financial information in detail. Very astute analysis. However, you tailored your statistics to support your desired conclusion that the Dodgers approach is not bad for baseball. And you seemed to call any people who disagree as brain challenged. Sounds like another blog that labels those who disagree as morons.
In your detailed article, you didn’t mention that the Dodgers 2025 payroll now exceeds every other team significantly at $370 million. The next highest is about $300 million. The bottom 15 teams average around $100 million payroll. And the Dodgers have $830 million guaranteed over the next 3 years, while the next highest guaranty in the MLB is $492 million. And that three of the final four teams in MLB last year were in the two largest markets with top 5 payrolls.
The randomness of the baseball postseason does make it difficult for teams to repeat and does allow for less talented teams to win in the playoffs. However, the large market teams have a significant revenue advantage over smaller market teams in the MLB. This is resulting in a big payroll discrepancy between the top spenders like LAD, NYY, and NYM and the smaller market teams like Pitt, Oak, and Tampa. Well run teams in smaller markets like Tampa and Cle can occasionally compete but everything needs to go perfect and then their top talent goes to the bigger markets. Like Lindor, Cole, Snell, and Glasnow.
I think baseball is a great game, but the NFL is more popular in this country by far. While KC is going to their third Super Bowl in a row, it has nothing to do with their market size or their payroll. They have a great QB and great coaches and are a well run franchise. (And maybe they have some friendly refs as well!). The AFC conference championship was between KC and Buffalo, two of the smallest markets in the NFL. And Washington made the NFC championship this year after having the second worst record in the NFL last year. The NFL is designed to share almost all revenues equally, and to ensure that team payrolls are roughly the same. The NY Jet payroll is roughly the same as the Buffalo payroll. Accordingly, the relative success or failure of an NFL team is not tied to their market or payroll amount and does not favor large market teams like MLB does. Every NFL team has a chance to become a Super Bowl contender in 2-3 years like Washington did this year. The Detroit Lions were cellar dwellers for decades but are now one of the best teams in the NFL. The Chargers went from 5-12 to 11-6 in one year. Alternatively, for 10-12 MLB teams there is not that level of hope. The Rockies are not going to win the division or make the playoffs this year. In fact, I would be willing to bet that they don’t win the division for at least 10 years and probably the next 15 years. And the White Sox, A’s, Marlins, and Pirates chances aren’t much better.
The payroll and revenue discrepancy is not the fault of the Dodgers. It has more to do with MLB structure and the ownership structure of the Dodgers. I believe that other leagues do not allow hedge funds/ investment firms to own franchises. The Guggenheim group is uniquely qualified to take advantage of deferred salaries and investing the funds profitably. But the Dodgers, along with the NY teams, have a big advantage in total revenues which translates into larger payrolls which should improve their chances of winning. The MLB playoff format limits the chances of the same team winning every year, but the Dodgers are well positioned to make the playoffs for the next 10 years in a row, while the Rockies most likely will make the playoffs zero of the next 10 years.
It may not be bad for MLB if the Dodgers, Yankees and big market teams dominate the MLB the next decade. The World Series ratings were up with the LAD-NYY World Series this year. But it is not good for the small market fans who often start the MLB season with very little hope of success.
This was a guy’s response to those who insist that the Dodgers are ruining baseball.
Sunday Lasagna
January 19, 2025
The Dodgers didn’t sign the top free agent batter or pitcher, Soto and Burnes, nor do they appear to be interested in the #3 rank Free Agent Alex Bregman
Instead they signed 32nd ranked Free agent Conforto to play RF, international FA Sasaki for the rotation and 26th ranked Free Agent Kim to help the infield.
Could have been Soto, Burnes and Bregman, but it is Conforto, Sasaki and Kim.
Dodgers didn’t buy the best, they bought solidly but not the best,
Dodgers signed the #4 Snell to replace the #8 rank free agent Flaherty
Teoscar re-signed
37th ranked Free Agent Buehler went away
Dodgers signed the #14 overall and top ranked reliever
The Dodgers actions on paper just don’t seem so overwhelming, but they sure have caused a lot of anger.
No one seems to be jumping all over Cohen for spending 762 million on Soto, who although he is a very talented young player, has nowhere near the status of Ohtani nor his ability to generate significant money in advertising from his home country. Had LA lost the World Series, I doubt much would be said about any of their signings.
Interesting read Jeff. No one was moaning when the Yankees bossed it.
One thing I can’t understand is the dislike of Max Scherzer among Dodger fans?
He was absolutely lights out for us, and even saved a game for us during the playoffs if I remember correctly, on short rest.. He then got injured.
What am I missing?
I actually think the Dodgers are saving baseball. People love to either watch and root for the Dodgers (and their stars) or watch and root against the Dodgers. Anyone remember the Yankees of the 70s as a very good example of this issue. The Dodgers brass are only spending money to make money, a whole lot of money and value.
If anyone is concerned about who is ruining baseball they should look at the rules committee and the owners. Come on, the phantom runner being placed on 2B in extra innings is a travesty to the rules of baseball, that’s one example of very stupid and gimmicky rules. Also, if anyone is ruining baseball it is the umpiring issue in baseball, it is extremely obvious on how awful balls and strikes are called, the technology is there to get balls and strikes called correctly. also, for the owners to allow very poor umpires to put into the playoffs and WS is really beyond the pale. Can you say DEI assignments (that should set Badger off).
So are the Dodgers ruining baseball? No not even close.
Is the commisioner and powers at be ruining baseball? Absolutely.
Baseball being ruined?
Hardly.
“The 2024 Major League Baseball season recorded increases in attendance, viewership, streaming, and fan engagement in its second season of new rules which have shortened games, removed dead time, helped showcase the athleticism of the players and created more action on the bases. The 2024 MLB season recorded the largest attendance in seven years (2017) with a total of 71,348,366, a +1% increase over last year’s total. The growth marks the first time MLB attendance has registered back-to-back attendance gains in 12 years (since 2011-12). Since the institution of the new rules, attendance has grown by nearly 6.8 million marking a +11% increase since 2022.”
The money is flowing and I’m certain nobody at the top wants to f with that. Fans are always going to growl but as long as the money is rolling in nothing will change.
We will see something done about the strike zone. It’s time. But putting a lid on large market teams? Nope. Not gonna happen.
Dodgers are still on the hook for $17M with Taylor. If they ate $12M to facilitate a trade and signed Kike for $5M, the money would be a wash and the Dodgers would be better. AF should be able to find a team that would take Taylor for $5M.
C’mon AF, get creative and bring Kike back.
In response to RC Dodger above.
Fair argument all the way around. The brain challenged comment comes from the consistent dribble from the Padres fans comments on MLBTR when they make the same inane comments over and over again regarding deferrals and LAD ruining the game because they actually won a World Series. They had no problem mocking Kershaw in 2022. They have no clue how deferrals work and yet the Dodgers are cheating because they do. So give me a description that is more apt for these?????
Interesting that you used Pittsburgh and the A’s in your reply. Bob Nutting bought the Pirates in 1992 for $92MM. As of March 2024, the franchise was estimated to be worth $1.32BB. He is notorious for taking his revenue sharing $$$ and sticking it into his pockets and not spending it on the team. John Fisher bought the A’s in 2005 for $180MM. Value of the A’s is $1.2BB. Fisher would not be spending on payroll this year if he was not required to. Do you honestly believe that Nutting or Fisher give a rip about winning? Their investment continues to climb thanks largely to the Dodgers, Yankees, Mets, and Boston franchises. Those teams are willing to spend to put a competitive team on the field, and the Pirates and A’s owners are all too happy to have their stadiums fill up because of the other teams.
It is not an apples to apples comparison in revenue sharing between NFL and MLB. NFL revenue sharing comprises of the total national media rights, league sponsorships and shared revenue and royalties from the league’s various affiliates and subsidiaries, such as NFL Properties, NFL International and NFL Enterprises and added up to roughly $13 billion in 2023. Each team received $400MM. The revenue grew to $14BB in 2024.
“The NFL is a made-for-home sport as ratings continue to soar. According to a recent US first-quarter 2024 Consumer Insights survey completed by S&P Global Market Intelligence Kagan, in which NFL viewers were asked to identify how they engaged with the NFL over the past year, only 12% said they had attended an NFL game in person while 82% indicated they watched live games on TV or through a streaming service. As such, The NFL Network Package is $110BB for 11 years.”
Here is an article on the NFL media rights:
https://www.spglobal.com/market-intelligence/en/news-insights/research/as-nfl-revenue-rises-current-media-rights-deals-ensure-future-success
MLB is not a made-for-home sport until the playoffs. They need gate receipts and the teams that put the best players on the field get the gate receipts. For 2023 the revenue sharing for local revenue generated $110MM for each team and another $90MM for network revenues. $200MM. That is 50% of what the NFL generated.
The NFL teams do not have a problem spending the salary cap. Many of the player contracts are not guaranteed in the NFL. Of course the elite players have many of the contract clauses that protect them like roster bonuses, skill guarantees, cap space guarantees.
The NFL does not have a MiLB system that they have to pay for. College football is the unaffiliated NFL minor leagues.
The NFL has 8 or 9 home games, while MLB has 81. That is 81 home games where parking, stadium, ticket sales, concessions, etc. personnel need to be hired and paid for vs 8 or 9 in the NFL.
Every one of the MLB contracts is 100% guaranteed except for special cases like Trevor Bauer, Wander Franco, and suspensions due to PED usage.
Draft picks can be traded in the NFL, but not MLB, except compensatory draft picks. The Dodgers have not selected in the top ten since Clayton Kershaw in 2006. The draft signing bonuses are limited in MLB, not in NFL. The Dodgers are at a complete disadvantage with the draft, and can do nothing about it. So they have to use the one big advantage they have, and that is pay for the elite players.
Should the Dodgers be penalized because they knew how to properly market Shoehei Ohtani and Arte Moreno did not? Ohtani reportedly allowed Moreno an opportunity to match the LAD offer. Moreno said no.
Good MLB organizations have scouts worldwide. Others choose to limit those resources. Should the good MLB teams be penalized for their player evaluation acumen?
Yes, an elite QB is needed to advance in the playoffs and win a Super Bowl. Tom Brady and Patrick Mahomes have proven that. That is not true in MLB.
If you want a hard cap like the NFL, make it a hard cap of $250MM for every team.
Bear, are you going to get one of these?
https://twitter.com/Topps/status/1884280374186147964
Padres re-signed Elias Diaz.
Kirby Yates deal is official. 1 year/$13MM plus an additional million if he appears in at least 55 games.
Correction: $500,000 at 50 games and another $500,000 at 55 games.
No corresponding move has been announced yet.
So the Kirby Yates deal is official: one year for $13 million.
And didn’t the bullpen seem pretty darn strong before Tanner Scott was signed?
Who is in Doc’s “trust tree” to start? Yates, Scott, Treinen, Kopech, Phillips, Vesia, Banda. (Brasier is under contract too, but the brass reportedly wants to trade him. And Graterol is recovering from an injury.)
That’s seven to go with a six-man rotation–and the Dodgers have about 8 or 9 legit candidates for the rotation. On Opening Day in Tokyo, these guys seem to be locks: Yamamoto, Sasaki, Snell, Glasnow. The last two spots could be a competition between Gonsolin, May, Miller, and Knack. And maybe Wrobleski if he sparkles in the spring.
Down the road–perhaps after an injury or two–Shohei will be worked in, and farther along we should see Kershaw and maybe Sheehan.
By adding Yates, the Dodgers seem to testing that maxim about never having too much pitching. The depth is just astounding.
And it’s really not fair to a lot of guys who will get passed over on the Dodgers, but would be vital players on small-market teams.
There needs to be some trades.
Tigers signed Tommy Kahnle
Dodgers and Vesia avoid arbitration. He gets 3.25 million.